NEW YORK (CNNMoney) — Mortgage rates continued to drop, with the 15-year fixed-rate loan hitting a record low, according to a weekly report from mortgage financier Freddie Mac.
The 15-year fixed rate fell to 2.61% this week from 2.64%, The previous record low of 2.63% was set the week of Nov. 21, 2012.
An adjustable-rate mortgage, the 5/1 ARM, also bottomed out at 2.58%. The most popular mortgage, the 30-year fixed-rate, came in at 3.4%, 0.09 percentage point above its record low.
“The housing market is getting a boost with mortgage rates hovering at or near record lows,” said Frank Nothaft, Freddie’s chief economist.
He cited a pick-up in the pace of existing home sales to nearly 5 million a year during the first quarter of 2013, the most since the fourth quarter of 2009.
The low 15-year rate meant that homeowners could book substantial savings by refinancing from their current 30-year fixed rates. For example, homeowners with 5% 30-year mortgages who switch to 2.6% loans would pay $21,000 in interest for every $100,000 borrowed over the course of the loan, compared with $93,000 in interest on the 30-year loan.
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